deleted domain is still unavailable

I would like to create a new blog: phpeter.worpress.com, but the WP says Sorry, that site already exists! When i'm trying to reach that url the WP says phpeter.wordpress.com is no longer available. Is it possible to free that domain? (I was the one who created that in the past, and cancelled)

It's perfectly sensible. You got the warnings, and deleted it anyway. Whether or not the original rule is a great idea is irrelevant. It is nonsensical to read that something is permanent and expect it not to be.

Deleting a WordPress.com blog is not easily done. To prevent accidental or inadvertent deletion of blogs, there are multiple warnings given that blog deletion is permanent. Deleting a site permanently removes it and you’ll never be able to reuse its WordPress.com address. If you delete a blog you will not be able to get it back and no one else will be able to use that blog address. You must be sure you never want to use the blog again if you delete it. Lastly, a verification link is sent in an email and must be clicked to delete a blog. http://en.support.wordpress.com/delete-site/